Iran says its engineers have managed to produce a nuclear fuel rod, marking a benchmark achievement for the country’s nuclear ambitions. Meanwhile the US issued new round of sanctions against Tehran in a bid to stop its atomic exploits.

­Nuclear fuel rods are devices used at power plants. They contain small pellets of fuel, usually low-enriched uranium, patterned in a way allowing them to give out heat produced by nuclear reaction without melting down. Building one is a technological challenge, which Iran was thought incapable of.

­According to the Iranian Nuclear Agency, the first rod produced by the country domestically has already been inserted into a research reactor, although it did not specify whether the device was loaded with fuel or not.

Tehran, which says it aims to develop a complex civilian nuclear industry, is facing difficulties in obtaining the technology and raw materials it needs to do it. Several major players believe that the program is just a cover-up for the real ambition to create a nuclear weapon and push for increasingly tougher sanctions against Iran – both unilateral and through international organizations.

The latest round of such sanctions was introduced on Saturday by US President Barack Obama as part of a controversial multibillion-dollar defense bill. The legislation aims to reduce Tehran’s oil revenues and is expected to force the country into making its nuclear program more transparent.

Iranian officials dismissed the American move, with the head of Chamber of Commerce Mohammad Nahavandian calling it “unjustifiable”.

Earlier on Saturday Tehran said that it wants to hold a new round of talks with the six-strong mediators group. The group consisting of China, France, Germany, Russia, UK and US is trying to defuse the controversy over the Iranian nuclear program.

­‘No place for arrogant powers in the region’

­Meanwhile, Iran has successfully test-fired several long-range missiles on the last day of major naval exercises in the international waters of the Persian Gulf.

Iran tested an upgraded version of a surface-to-surface missile, called Ghader (Capable). An earlier version of the missile had a range of 200 kilometers. The upgraded missile would be capable of countering the US military presence in the region if required. On Sunday Iran also test-fired a new surface-to-air missile.

A large-scale naval exercise was launched on December 24 to demonstrate Iran’s military power in an area of two square miles that extends from the eastern Strait of Hormuz in the Persian Gulf to the Gulf of Aden.

Amid the growing tensions between the US and Iran over its nuclear program, Tehran reportedly declared its readiness to block the strait in response to a direct military attack by the US or its allies, or sanctions that would hamper Iran’s oil exports.

But Iran’s Deputy Navy Commander Rear Admiral Mahmoud Mousavi stated that Iran has no plans so far to disrupt the free flow of maritime shipping through the Strait of Hormuz and the Persian Gulf.

Mousavi however added that “any effort to harm the interests of the Islamic Republic in the area will undoubtedly lead to reciprocal measures by Iran,” as cited by Press TV.

Iran’s Navy Commander, Admiral Habibollah Sayyari, confirmed the statement, saying that they had “no orders to close the Strait of Hormuz,” but were ready for “different options.” The Iranian commander said there should be no military presence of foreign forces in the Persian Gulf. "There is no place for arrogant powers in the region. This is the message of the 'Velayat-90' drill" Sayyari said.

Hisham Jaber, the director of the Center for Middle East Studies, told RT that in his opinion Iran will not close the Strait of Hormuz unless the sanctions imposed by the US and its allies hamper Iran’s oil exports.

"If the sanction touches the oil of Iran, the situation will be dangerous," Jaber said. "If America and its allies forbid Iran to export its oil, in Iran’s opinion it is a red line. And it’s not a sanction only against Iran, it is a sanction against Iran’s clients like China, like Japan, like many countries in the world."

Jaber says that neither Iran nor the US has any interest in having a military conflict in the gulf, but admits that such an outcome is possible, as the West's actions are adding fuel to an already highly flammable situation.

"Maybe Iran will not close the Strait of Hormuz, but it may disturb the navigation in that area," he added."In this case – with the presence of battleships from both sides – we risk having a small conflict. And this small conflict may lead to a war in the region."